Zacky Farms disclosure approved; plan confirmation hearing June 25

By Caroline Salls

Pittsburgh, May 3 - Zacky Farms, LLC received court approval of the disclosure statement for its amended plan of liquidation, according to a Thursday filing with the U.S. Bankruptcy Court for the Eastern District of California.

The plan confirmation hearing is scheduled for June 25.

Treatment of creditors will include the following:

• Administrative claims and non-tax priority claims already have been or will be paid in full;

• The two major secured claims filed against Zacky Farms were resolved under a debtor-in-possession lender settlement.

The company said it does not expect disputed secured claims to be allowed, other than a Richard Zacky Trust lien claim.

Zacky Farms said it currently cannot estimate whether there will be a distribution on the trust's lien claim. To the extent it becomes an allowed claim, the trust's lien claim will be paid from the proceeds of a $3.5 million creditor note;

• Holders of 503(b)(9) claims will be paid from 503(b)(9) note proceeds on or after Aug. 26;

• General unsecured creditors will be paid from estate assets to the extent net available cash exists after payment or reserve for all senior claims; and

• Members will retain their interests, but the company's operating agreement will be amended to eliminate any power or right to effect management of Zacky Farms after confirmation, except to the extent authorized by other plan provisions.

No distributions will be made to members until all other allowed claims and/or obligations are fully satisfied.

Zacky Farms is a Fresno, Calif.-based poultry producer. The company filed for bankruptcy on Oct. 9, 2012 under Chapter 11 case number 12-37961.

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